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12.05.202119:08 Forex Analysis & Reviews: Technical analysis on EURUSD for May 12, 2021.

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EURUSD is pulling back towards 1.2065. In previous posts we warned that a bigger pull back is justified as there are warning signals by the RSI in the Daily chart. The bearish divergence is an important warning that should not be ignored. However it is still too early to call a top, bulls still have hopes of a new higher high.

Red lines - bearish divergence

EURUSD made new higher high but the RSI did not follow. The RSI provided a bearish divergence. Price has support now at 1.2060 and next at 1.1990. If price breaks below 1.1990 I expect more selling pressure to push prices lower towards 1.1850.

Blue lines - Fibonacci retracement

EURUSD is approaching the 61.8% Fibonacci short-term retracement. This is important short-term support. Breaking below it will increase chances of a move lower towards recent low of 1.1990. However if bulls manage to hold above 1.2060, then we could see a move to new highs above 1.2180.

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